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Exercise 4: Translate the conversation between Ann, director of a successful company and her acquaintance. What kind of competition did Ann face?

Vocabulary | Read the text about marketing and promotion and decide how much they are important for success in business. | Exercise 4: Translate into English an extract of a marketing specialist's report which was given at a marketing conference. Say if you agree with his statements. | INFORMATION TO HELP YOUR BUSINESS GROW | Tipsfor optimising thesale price | Vocabulary | Exercise 2: Find the words in the article to complete the following statements. | Exercise 4: Match the beginnings of the sentences to their ends using the information from the Text 2. | BUSINESSES SET TO VIE FOR NORTH TOP AWARDS | UNIT 5: COMPETITION |


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J. Привет! Не ожидал встретить тебя здесь! Прекрасно выглядишь! Слышал, что у тебя преуспевающая компания.

A. Это правда. Хотя налоги мы платим вовремя, прибыль у нас есть.

J. Значит, у тебя нет никаких проблем?

A. К сожалению, проблема есть и очень большая. Это конкуренция. Наша компания старалась избежать ее, но она неизбежна!

J. Правда? А я слышал о фирмах, которые полностью контролируют рынок.

A. Ты, наверное, говоришь о монополистической ситуацию Но это – редкость для рыночной экономики. Кром е того, государство полностью контролирует монополии. Например, во многих государствах цены компаний должны быть одобрены государственными учреждениями.

J. А с какой ситуацией столкнулась ты?

A. С чистой конкуренцией. Мы конкурируем с компаниями, которые предлагают подобный товар. Самой большой проблемой является то, что покупатели воспринимают различные товары как замену друг другу.

J. А можно найти какой-нибудь выход?

A. В общем, да. Например, понизить цену или найти какую-нибудь особенность, которая бы отличала наш товар от других. Но небольшие отличия не всегда помогают. Наши менеджеры по продажам как раз сейчас работают над этим.

J. Ну что ж, удачи тебе!

 

Text 2: From the first Text 1 you have learned about the basic kinds of com­petition. Now it is time to know how a marketing manager can avoid it. Hopefully you will use this information in your life.

Read the text and say what any marketing manager should know about potential competitors.

 

The best work for the marketing manager to avoid head-on competi­tion is to find new or better ways to satisfy customers' needs. The search for a breakthrough opportunity - or some sort of competitive advantage - requires an understanding not only of customers but also of competi­tors. That's why marketing managers turn to competitor analysis - an or­ganized approach for evaluating the strengths and weaknesses of current or potential competitors' marketing strategies. A complete discussion of the possible approaches for competitor analysis is beyond the scope of the first marketing course. But we will briefly cover an approach that works well in many different market situations.

The basic idea is simple. You compare your current (or planned) target market and a marketing mix with what competitors are currently doing or are likely to do in response to your strategy. You also consider competitive barriers- the conditions that may make it difficult, or even impossible, for a firm to compete in a market. Such barriers may limit your own plans or, alternatively, block competitors' responses to an innovative strategy. For example, Nutra Sweet's soon-to-expire patent on its low-calorie sweeten­er effectively limited direct competitors from entering the market.

The initial step in competitor analysis is to identify potential competi­tors. It's useful to start broadly - and from the viewpoint of target cus­tomers. Companies may offer quite different products to meet the same needs, but they are competitors if customers see them as offering close substitutes. For example, Dow ZipLock bags, Reynold's aluminum foil, Sarah Wrap, and Tupperware containers compete in the same genetic mar­ket for food storage needs. Identifying a broad set of potential competitors helps marketing managers understand the different ways customers are currently meeting needs and sometimes points to new opportunities.

Usually, however, marketing managers quickly narrow the focus of a com­petitor analysis to the set of rival firms who will be the closest competitors.

Even if no specific competitors can be identified, marketing managers must consider how long it might take for potential competitors to appear and what they might do. It's easy to make a mistake of assuming that there won't be competition in the future - or of discounting how aggressive com­petition may become. But a successful strategy attracts others who are ea­ger to jump in for a share of the profit - even if profits only hold up for a short time. That is why it is important for firms to find opportunities where they can sustain a competitive advantage over the longer run.

Finding a sustainable competitive advantage requires special attention to competitor strengths and weaknesses. For example, it is very difficult to dislodge a competitor who is already a market leader simply by attacking with a strategy that has similar strengths. An established leader can usually defend its position by quickly copying the best parts of what a new com­petitor is trying to do. On the other hand, an established competitor may not be able to defend quickly if it is attacked where it is weak. For exam­ple, Right Guard deodorant built its strong position with an aerosol spray dispenser. But many consumers don't like the messy aerosol cloud - or have become concerned about the effect of aerosols on the environment. That weakness provided Old Spice with a competitive opportunity for a deodorant in a pump dispenser. Right Guard did not quickly fight back with its own pump. The company thought that promoting a pump could hurt sales of its established product - and might even help the competitor.

A marketing manager should actively seek information about current or potential competitors. Although most firms try to keep the specifics of their plans secret, much public information may be available. For example, many firms routinely monitor competitors' local newspapers. In one such case, an article discussed a change in the competitor's sales organization. An alert marketing manager realized that the change was made to strengthen the competitor's ability to take business from one of her firm's key target mar­kets. This early warning provided time to make adjustments. Other sources of competitor information include trade publications, alert sales reps, mid­dlemen, and other industry experts. In business markets, customers may be quick to explain what competing suppliers are offering.

The search for information about competitors sometimes raises ethical issues. For example, it's not unusual for people to change jobs and move to a competing firm in the same industry. Such people may have a great deal of information about the competitor, but is it ethical for them to use it? Similarly, some firms have been criticized for going too far - like wait­ing at a landfill for competitors' trash to find copies of confidential com­pany reports.

Beyond the moral issues, stepping over the line of ethical behavior can prove to be very costly. Spying on competitors to obtain trade secrets is il­legal, and damage awards can be huge. For example, the courts ordered Keebler Co., Nabisco Brands, and Frito-Lay to pay Procter & Gamble about $125 million in damages for stealing secrets about its Duncan Hines soft cookies. Nabisco had obtained Duncan Hines' recipe by entering a restricted area. Keebler has gone so far as to hire an airplane to take aerial photographs of a Duncan Hines manufacturing facility that was under con­struction. A Frito-Lay employee posed as a potential customer to attend a confidential sales presentation.

 


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